Credit and Prepaid Card News
The latest news on the credit card and prepaid card industry from the Center for Responsible Lending.
- 5 Ways to Deter Credit Card Fraud
CBS MoneyWatch 15 Oct 2013
Credit-scoring giant FICO reports that credit card fraud is on a rapid rise, especially cases where stolen data is used to make purchases online or by phone. Most banks do not hold customers responsible for a fraudulent charge that is reported on time, but consumers can still take a few steps to protect themselves.
- Credit Default Rates Increase Nationally
National Mortgage Professional 14 Oct 2013
According to the S&P/Experian Consumer Credit Default Indices, national default rates rose in September. The national composite edged up from 1.34 percent in August to 1.38 percent. Default rates were 1.28 percent for first mortgages, up from 1.23 percent; 0.69 percent for second mortgages, up from 0.57 percent; 1.15 percent for auto loans, up from 1.11 percent; and 3.14 percent for bank cards, up from 3.12 percent.
- Small Business Credit Cards May Lack Consumer Protections
Time 14 Oct 2013
The Credit Card Accountability Responsibility and Disclosure Act of 2009 was meant to protect consumers from unexpectedly higher rates and unwarranted penalty fees. The law does not, however, cover business credit cards.
- Young Credit Card Holders Are Less Likely to Default
Bloomberg 08 Oct 2013
Although Congress passed the CARD Act in 2009 to help prevent consumers under age 21 from digging themselves deep into credit card debt, a new study by researchers at Arizona State University and the Federal Reserve Bank of Richmond suggests that younger credit card users are not more likely to default. Consumers in this age group, rather, are working to build a credit history.
- New Tactics Keep College Kids Hooked on Plastic
CNBC News 04 Oct 2013
Since passage of the Credit Card Accountability, Responsibility and Disclosure Act of 2009, use of credit cards among college students has declined. Debit cards, however, are becoming more common and now are used by nearly 80 percent of students, a survey by Sallie Mae and Ipsos found. Many student ID cards double as debit cards, and prepaid cards are gaining popularity among parents who want to better control their kids' spending. The problem with prepaid and debit cards is that they do not allow students to build a credit record, and they often come with fewer marketing restrictions.
- Study: Debit Swipe Fee Reform Saves Consumers, Merchants Billions
Bank Credit News 04 Oct 2013
Reform of debit-card swipe fees helped save U.S. merchants and consumers billions of dollars in 2012, according to a report released by the Merchant Payments Coalition (MPC). This was one of the objectives when Congress passed the law in 2010.
- CFPB Should Take Tougher Stance Against Credit Cards, Consumer Groups Say
American Banker 03 Oct 2013
Consumer advocates have asked that the Consumer Financial Protection Bureau (CFPB) take an even harder line with credit card issuers. At a field hearing in Chicago after the watchdog released its study on the impact of card regulations over the last four years, advocates urged the regulator not to leave its scrutiny at simply sneaky rate hikes and fees but to delve deeper into legal disclosures.
- Bank Credit-Card Fees Face New Scrutiny by U.S. Consumer Bureau
Bloomberg 02 Oct 2013
The Credit Card Accountability Responsibility and Disclosure (CARD) Act of 2009 limited lenders' ability to hike interest rates, curtailed late fees, and forced lenders to obtain customers' consent to apply over-limit fees. The law produced $4 billion in savings to U.S. consumers last year through these impacts, according to the Consumer Financial Protection Bureau (CFPB), which calculated that the total cost of credit on the cards is down by two percentage points.
- OCC Warns of Credit Card Scam
American Banker 27 Sep 2013
A fake Florida bank has been using a fraudulent credit card scheme to cheat U.S. consumers, the Office of the Comptroller of the Currency (OCC) is cautioning. The bogus AmTrade International Bank sends consumers mail offers for semi-secured credit cards, instructing them to send checks in amounts ranging from $500 to $900 in order to obtain the card. Marketed as a strategy for rebuilding damaged credit, the card never arrives after the consumer's check gets cashed.
- Chase Scraps Joint Credit Cards
CNN Money 24 Sep 2013
In a move likely to be copied by other banks, Chase has announced it will no longer allow customers to open joint credit cards -- a popular option for couples sharing the responsibility of repayment.
- JPMorgan Fined $389 Million for Deceptive Credit Card Practices
Washington Post 20 Sep 2013
The Office of the Comptroller of the Currency (OCC) on Thursday hit JPMorgan Chase with $389 million in penalties for duping millions of customers into buying expensive and unnecessary services when they signed up for credit cards.
- Banks Probe Regulatory Limits of Credit Card Add-Ons
American Banker 17 Sep 2013
American Express, Wells Fargo, and Citigroup all seem to be testing how far they can go with credit card add-on services, even though regulators are preparing for another round of crackdowns on these controversial products.
- FTC Tussles With a Florida Telemarketer -- Again
Cleveland Plain Dealer (OH) 10 Sep 2013
Brett Fisher, whom the Federal Trade Commission (FTC) has just hit with a $25 million penalty for preying on consumers, is no stranger to the agency. It previously sued the Florida man and his company at the time, Group One Networks, over an advance-fee credit card scheme. A January 2010 settlement drew a $17 million fine -- of which the defendant was able to pay only $21,000 -- and prevented Fisher, among other restrictions, from marketing interest-rate reduction services. Undeterred by his legal loss, Fisher reportedly launched a new scheme almost immediately.
- Regulators Ramping Up Fair Lending Enforcement
Credit Union Times 09 Sep 2013
With the National Credit Union Administration and the Consumer Financial Protection Bureau (CFPB) zeroing in on Fair Lending laws and Home Mortgage Disclosure Act (HMDA) data collection this year, credit unions can expect to see additional rules and exams in 2014.
- A Secret That Credit Card Companies Don't Want Pa. Debtors to Know
Johnstown Tribune-Democrat 02 Sep 2013
Under Pennsylvania law, credit card companies must take action on a debt within four years. After that, the law dictates, the debt is no longer collectible. State Rep. Pete Daley (D-Allegheny) has proposed legislation that would force collection agencies to tell consumers if the debt they are pursuing is too old to legally claim and also would require the agencies to put in writing the amount they claim the consumer owes.
- Many Customers Don’t Understand Their Credit Card Rewards
Credit.com 28 Aug 2013
More than one-third of credit card users are either unaware of the benefits connected with their cards or do not completely understand them, according to the J.D. Power 2013 U.S. Credit Card Satisfaction Study.
- Zero Worship: Credit-Card Firms Compete With No-Interest Transfers
Wall Street Journal 27 Aug 2013
U.S. credit card companies, eager for new customers, are flooding mailboxes and email inboxes with offers that allow new cardholders to transfer their existing card balances from other institutions with zero interest for up to two years.
- Direct Mail Offers for Credit Cards Are on the Rise
Pittsburgh Post-Gazette 26 Aug 2013
Direct-mail solicitations from credit card issuers are on the rise this year, up by 22 percent through June compared with the same stretch of 2012, according to the market research company Mintel.
- Many Americans Don't Understand Fine Print of Credit Cards
Los Angeles Times 22 Aug 2013
A J.D. Power survey of 14,000 credit card users found that just 47 percent of those polled completely understand their credit card terms, and only 59 percent completely understand their cards' reward programs